Abstract
We treat the scheduling of a single server in a finite-buffer capacity, multi-class, make-to-order production system subject to inventory holding costs, set-up times, and customer rejection costs. We employ theoretical and numerical analysis of a Markov decision process model to investigate the structure of optimal policies and the performance of heuristic policies. We establish the monotonicity of optimal performance with respect to the system parameters. Based on our insights, we provide a heuristic policy called the Capacitated Modified Index Rule (CMIR) for capacitated scheduling with customer loss penalties. The CMIR heuristic can easily be precomputed and stored for real-time control. Numerical benchmarking with respect to the optimal performance as well as an existing heuristic suggests that CMIR is very effective.
| Original language | English |
|---|---|
| Pages (from-to) | 807-818 |
| Number of pages | 12 |
| Journal | IIE Transactions (Institute of Industrial Engineers) |
| Volume | 32 |
| Issue number | 9 |
| DOIs | |
| State | Published - Sep 2000 |
Bibliographical note
Funding Information:The work of the authors was supported by the National Science Foundation under Grant No. [)MI-9522795. This work is based on Eungab Kim's dissertation under the direction of Mark Van Oyen at Northwestern University. Dr. h m is now with Manufacturing Development, Team Samsung SDS, Ilok Bld. 16F Yeoksarn-Dong, Kangnam-Gu, Seoul, Korea 135-080. We wish to acknowledge Maria Rieders, who worked jointly with us on numerically characterizing the structure of optimal policies.